Saturday, August 28, 2004

HP's iPod - A distribution deal by any other name

There has been a huge amount of news around the launch of HP's iPod. While this product launch was not a surprise (HP announced this a long time ago) what was a surprise to me is that the product is essentially nothing more than Apple's design with no meaningful HP branding.

With their launch of numerous CE devices (Plasma TVs, media adapters, etc.) what does HP's inability to negotiate any real branding on the "hPod" mean? It means that Apple has a lot of market power right now in the portable device arena, which is obvious. What isn't obvious is that it also signifies HP's willingness to be almost nothing more than a distributor if they don't think they can win in a market.

Lets be clear here, this is NOTHING more than a distribution deal. HP clearly doesn't have control over the products design or features. I am also certain that HP doesn't have too much control over pricing, branding, or any other marketing function. No, HP has control over a single aspect of the hPod... and that is distribution.

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